City Ramping Up for $1.2mil Downtown Improvement Loan
Posted February 19, 2015 06:30 am
A view of downtown Lake City during a CRA Committee sponsored walking tour. Read the article.
LAKE CITY, FL – Tuesday night saw the City Council unanimously approve the first step in securing a $1,200,000 loan to improve downtown Lake City. Florida statutes require the City Council approve the loan twice. Mayor Witt was the only Council member who commented on the loan. City Manager Wendell Johnson, who many believe is making the downtown renovation his legacy, asked the Council if they understood what the loan was going to do for the City over the next 15 years.
Attorney Josh Crapps, sitting in for the City's legendary City Attorney, Herbert Darby, read the ordinance extending the downtown Community Redevelopment Agency through 2031 and enabling the City to borrow $1,200,000 to be used on projects in the downtown.
On the back burner since 2012
In January 2012, IBI's Master Planner Kurt Easton explained Lake City's new Master Plan as IBI's Suzanne Thompson took notes. Read the article.
The City is going to borrow the money first
The City is going to borrow the money first and then figure out what to do with it.
After the unanimous vote approving the ordinance (City Councilman Zack Paulk was absent) Mayor Witt was the only Council member to comment. He said, "I think this is a good thing to extend it out and it's a good thing for us."
Not hearing any other comments, City Manager Johnson addressed the Council: "Does the Council have an understanding of what this is really going to do for the CRA over next 15 years? If we do not extend this CRA, which is the downtown commercial district from 1988 it will expire in 2018. The revenues that will be coming from that source will no longer come to the City. The money that is being leveraged for this loan is actually going to be paid back by the addition and extension and the projects obviously of those things that were identified in the master plan."
City Manager Johnson explained the loan: "It's not like going to the bank and putting the city in debt, because if we don't do this we won't get the money anyway. The sunset of the CRA district that generates these revenues will expire."
He continued, "Once the loan closes and the funds are in the bank the Citizens Advisory Committee will have a lot of work cut out for em'. Hopefully we will have public input as to the project has been identified -- the two projects, but certainly the area affecting Lake De Soto. We want public input and we will need public input to help the Advisory Committee to formulate the details of how the money is spent to make a most optimum return to the investment at the lake. I just want everybody to know that."
Exploring Other Options?
Your reporter asked City Manager Johnson if there might be other ways to improve the downtown without taking a loan, such as establishing a Business Improvement District (BID) and entering into an interlocal agreement with the County to direct tax dollars back into the downtown and thus saving over $300,000 in interest, "If the City and the County could agree on something. Would that be wrong?"
City Manager Johnson answered, "I won't say it would be wrong. I don't think of this as a viable or as appropriate in accordance with the state statutes in these typical relationships you have with these kind of districts. I don't know what kind of district you're talking about. The money is the money. No matter how you get the money up front -- whether the County's going to commit it, or the City's going to commit it, it's going to come from tax dollars. Of course as you know, this district is still on the tax rolls contrary to popular belief. I think this is the most effective way to do it. It's the most customary way. I'm not fully understanding what you're suggesting."
Your reporter followed up explaining the City would be paying interest on this note. "There possibly may be another way to do this if the City and the County could agree – there would [could] be no interest."
City Manager Johnson replied, "That's not necessarily correct. That's speculation on your part."
City Councilman Ward added, "You'd have to wait on the cash flow year after year to do any projects. This way we can go ahead and secure the loan and pay it back with cheaper dollars down the road."
City Manager Johnson added, "The interest will be somewhere around 2% -- 2.5%."